BRITISH TRADE SYSTEM

Southland Times, Issue 25796, 6 October 1945, Page 5

BRITISH TRADE SYSTEM

Little Danger To , America NEW YORK, October 4. British Imperial preference may not be such a menace as the British would like us to believe, says the Washington correspondent of The New York Times. At least some American Government officials have studied the system and its effect on British-American trade and have presented information in confidential documents. These show that the Ottawa preferences have so little ill-effect on trade that, in one official’s opinion, it would be a mistake for the United States to insist on immediate abolition, but rather should ask that it be gradually replaced by a multilateral system. Imperial preference, although devised by Britain, had not had the desired effect. Although the Ottawa agreements somewhat increased the share of United Kingdom exports which went to Empire markets, they had not increased to any substantial extent the proportions of the Dominions and Indian imports from Britain. Britain’s share in the Indian and South African markets had, in fact, sharply declined. The preference system could only benefit Britain and other parts of the Empire, if at all, during a period of declining world trade. However, regardless of how powerfully the facts may seem to argue, the preference system is of little danger to America. It is believed likely by many Washington negotiators that the United States will insist on its abolition, if only because of political pressure.

MORAL OBLIGATION “The Ui|ted States has a moral obligation to provide England with financial assistance, but such aid should only be given as part of a global agreement between the United States and all members of the British Commonwealth to join in a system of multilateral trade,” said the president of the International Chamber of Commerce, Mr W. Aldridge, in a speech. “Unless the United States extends credit and unless reciprocal concessions such as the elimination of exchange controls and the termination of the sterling area are affected by England, and all British Commonwealth members, the British people will be forced into a system of bilateralism which will inevitably lead to a British-American trade war and under the present world conditions this might be disastrous.” Mr Aldridge suggested (1) that members of the sterling area who were wartime creditors of England drastically reduce their sterling claims; (2) that the systems of Imperial preferences and quantitative trade controls be relinquished; (3) that the United States and toe British Commonwealth agree to a substantial reduction of import duties; and (4) that the United States eliminate export subsidies. He declared that an agreement along such lines would be of immense mutual advantage to the United States and the British Commonwealth. A Canadian Government spokesman said that Canada was prepared to go a long way towards unrestricted world trade, but other countries must also make concessions. The Cabinet had so far not been advised of the Washington report that the United States was insisting on the abandonment of Empire trade preference. He preferred not to make any comment that might interfere with the negotiations.